World Gas Conference (WGC 2021) – A Sustainable Future ... · This presentation contains...

TitleIGU Diplomatic Gas Forum

The Vital Role of Natural Gas towards a

Sustainable Energy Future

Seoul, Korea

A Sustainable Future – Powered by Gas

Opening Remarks

Prof. Joe KangPresident, IGU


2018 World in Review Main Energy Related Trends

Poor Air Quality

91% of World Population lives in Areas with Unhealthy Air

Urbanisation

Over half of the world’s population lived in cities in 2018, up from just a third in 1960.

Energy Access

Globally energy access continues to increase, but much more needs to be done to meet UN Sustainable Development Goals.

Source: World Bank

Annual electricity access growth rate2010-2016

Source: UN

World Urban and Rural Populationbillions

Source: WHO

PM10 Annual mean concentration (ug/m3)2014-17


Greatest urbanization will occur in regions with lowest gas penetration today

0 20 40 60

Middle East 59

40

33

Non-OECD Europe

24 OECD Europe

24 OECD Asia Oceania

OECD Americas

(%)

Non-OECD Americas 22

Africa 13

Non-OECD Asia(ex. China)

12

China 4271

797

867

132

70

2

134

-11

118

-300 0 300 600 900 (M)

Middle East

Non-OECD Europe

OECD Americas

OECD Asia Oceania

OECD Europe

Non-OECD Americas

Africa

Non-OECD Asia (ex. China)

China

Gas share of energy consumption1 Projected urban population growth (2015-50)

Includes weighted average of power generation, buildings, and industry sectors; based on 2015 dataSource: IEA, UN Population Division, BCG analysis


Policy plays a critical role for shaping gas market development

Policy is critical to developing gas value chains Example: Divergence between China and India

Production

Trade

Infra-structure

Consumption

• Production targets• Priority upstream licensing• Market-based pricing

• Competitive tariff structures• Foreign gas trade agreements• Anchor agreements by public utilities

• Capacity development targets• Expedited permitting• Capex support/lending programs

• Pricing of environmental externalities• Fuel switching requirements/incentives• Priority sector-based incentives

Examples of successful policies

2012 2000 2014 2016 2018

250

2002

100

2006

50

150

2010

200

2008 0

2004

Gas consumption (bcm)

>4x

India

China


Looking Toward the Future Industry Priorities

1A. Reducing LNG costs through the supply chain

2A. Expanding gas pipeline and storage infrastructure

3A. Adoption of local air pollution policies

1. Cost competitiveness 2. Security of supply 3. Sustainability

1B.Pricing environmental externalities

1C. Development of local gas production

2B. More flexible LNG contracting

2C. Development of new access-enabling technologies

3B. Development of low carbon technologies for gas

3C. Addressing the methane emissions challenge

Industry action required Gov. action required


Thank you


Welcome Remarks

Vice Minister Taeho LeeMinistry of Foreign Affairs


Congratulatory Remarks

Deputy Minister Young Jun JooMinistry of Trade, Industry and Energy


Congratulatory Remarks

Acting Chair and CEO Young Doo KimNOC of WGC2021 / KOGAS


Coffee Break

(10 : 30 ~ 10 : 50)

TitleIGU Diplomatic Gas Forum



Seoul, Korea

Improving the Air We Breath

March 28, 2019Korea Diplomatic Forum

Mel YdreosDirector Public AffairsInternational Gas Union

Case Studies in Improving Urban Air Quality

2015 Case Studies:New York, Istanbul, Toronto, Beijing

Istanbul – Natural Gas improved air quality

Financial Times coverage during COP 21

2016 Case Studies:Berlin, Dublin, Krakow, Rotterdam

2018 Case Studies: Beijing, Shanghai, Urmqi, Santiago

Beijing – Natural Gas improves the air quality

Urumqi, China

Heating with coal, before boiler replacement (Jan-Mar 2012)

Heating with gas post replacement (Jan-Mar 2014)

PM Levels Pre and Post Boiler Replacement

Drastic Improvement in just 2 years, after coal to gas heating replacement effort


Thank you

Title

Tahir Faruqui, General Manager Downstream LNG

Shell

IGU Diplomatic Gas Forum




The companies in which Royal Dutch Shell plc directly and indirectly owns investments are separate legal entities. In this presentation “Shell”, “Shell group” and “Royal Dutch

Shell” are sometimes used for convenience where references are made to Royal Dutch Shell plc and its subsidiaries in general. Likewise, the words “we”, “us” and “our” are

also used to refer to Royal Dutch Shell plc and its subsidiaries in general or to those who work for them. These terms are also used where no useful purpose is served by

identifying the particular entity or entities. ‘‘Subsidiaries’’, “Shell subsidiaries” and “Shell companies” as used in this presentation refer to entities over which Royal Dutch Shell plc

either directly or indirectly has control. Entities and unincorporated arrangements over which Shell has joint control are generally referred to as “joint ventures” and “joint

operations”, respectively. Entities over which Shell has significant influence but neither control nor joint control are referred to as “associates”. The term “Shell interest” is used

for convenience to indicate the direct and/or indirect ownership interest held by Shell in an entity or unincorporated joint arrangement, after exclusion of all third-party interest.

This presentation contains forward-looking statements (within the meaning of the U.S. Private Securities Litigation Reform Act of 1995) concerning the financial condition, results

of operations and businesses of Royal Dutch Shell. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. Forward-

looking statements are statements of future expectations that are based on management’s current expectations and assumptions and involve known and unknown risks and

uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements. Forward-looking statements

include, among other things, statements concerning the potential exposure of Royal Dutch Shell to market risks and statements expressing management’s expectations,

beliefs, estimates, forecasts, projections and assumptions. These forward-looking statements are identified by their use of terms and phrases such as “aim”, “ambition’,

‘‘anticipate’’, ‘‘believe’’, ‘‘could’’, ‘‘estimate’’, ‘‘expect’’, ‘‘goals’’, ‘‘intend’’, ‘‘may’’, ‘‘objectives’’, ‘‘outlook’’, ‘‘plan’’, ‘‘probably’’, ‘‘project’’, ‘‘risks’’, “schedule”, ‘‘seek’’,

‘‘should’’, ‘‘target’’, ‘‘will’’ and similar terms and phrases. There are a number of factors that could affect the future operations of Royal Dutch Shell and could cause those

results to differ materially from those expressed in the forward-looking statements included in this presentation, including (without limitation): (a) price fluctuations in crude oil

and natural gas; (b) changes in demand for Shell’s products; (c) currency fluctuations; (d) drilling and production results; (e) reserves estimates; (f) loss of market share and

industry competition; (g) environmental and physical risks; (h) risks associated with the identification of suitable potential acquisition properties and targets, and successful

negotiation and completion of such transactions; (i) the risk of doing business in developing countries and countries subject to international sanctions; (j) legislative, fiscal and

regulatory developments including regulatory measures addressing climate change; (k) economic and financial market conditions in various countries and regions; (l) political

risks, including the risks of expropriation and renegotiation of the terms of contracts with governmental entities, delays or advancements in the approval of projects and delays

in the reimbursement for shared costs; and (m) changes in trading conditions. No assurance is provided that future dividend payments will match or exceed previous dividend

payments. All forward-looking statements contained in this presentation are expressly qualified in their entirety by the cautionary statements contained or referred to in this

section. Readers should not place undue reliance on forward-looking statements. Additional risk factors that may affect future results are contained in Royal Dutch Shell’s Form

20-F for the year ended December 31, 2017 (available at www.shell.com/investor and www.sec.gov). These risk factors also expressly qualify all forward-looking statements

contained in this presentation and should be considered by the reader. Each forward-looking statement speaks only as of the date of this presentation, March 28, 2019.

Neither Royal Dutch Shell plc nor any of its subsidiaries undertake any obligation to publicly update or revise any forward-looking statement as a result of new information,

future events or other information. In light of these risks, results could differ materially from those stated, implied or inferred from the forward-looking statements contained in this

presentation. We may have used certain terms, such as resources, in this presentation that the United States Securities and Exchange Commission (SEC) strictly prohibits us from

including in our filings with the SEC. U.S. Investors are urged to consider closely the disclosure in our Form 20-F, File No 1-32575, available on the SEC website www.sec.gov.

Cautionary Note


According to the International Maritime Organization (IMO), maritime CO2 emissions are projected to increasebetween 50% and 250% by 2050

SHIPPING GLOBALLY EMITS (2012 ESTIMATE)

Source: IMO 3rd GHG Study 2014, Federal Environment Office Germany (Umwelt Bundesamt), Department of Energy & Climate Change United Kingdom, Ministry of Agriculture, Food and Environment, Spain

= of global emissions

3%972 million

tonnes CO2e OR +

WORLD COASTLINES AS DEFINED BY SHIPPING ROUTES

Source: shipmap.org

THE MARITIME INDUSTRY IS A MAJOR SOURCE OF GHG EMISSIONS

=


LNG IS A CLEANER MARINE FUEL

28

*Significantly reduced NOx depending on tier 1/2/3 engine: Particle- and Gaseous Emissions from an LNG Powered Ship; M. Anderson, K. Salo, E. Fridell; Environ. Sci. Technol. 2015, 49, 12568-12575

LNG has lower local emissions (SOx, PM, NOx) vs heavy fuel oil in marine engines*

Natural gas emits virtually zero SOx

LNG BENEFITS

READILY AVAILABLE

COST COMPETITIVE

MEETING EMISSIONS

REGULATIONS

CLEANER

* Thinkstep, Greenhouse Gas Intensity of Natural Gas prepared for Natural & Bio Gas Vehicle Association (NGVA) Europe, V1.0, 05/05/2017 for ship and truck WtW savings. One example of emissions reductionusing one large high pressure 2-stroke engine. Unburned methane in the exhaust (methane slip) has higher GHG impact than fuel completely combusted to CO2.

WELL TO WAKE CO2 EMISSIONS

X 100

X 100

X 100

X 100

X 10021%*

Equivalent to 500 heavy duty trucksremoved from the road for a single ship

80% lower NOx

PM

PARTICULATEMATTER

90%*


LNG bunkering developments

LNG supply

KEY

Maritime key hubs

LNG MARINE FUEL IS AVAILABLE IN 150 LOCATIONS,

OVERLAPPING WITH KEY MARITIME HUBS


126 LNG VESSELS IN OPERATION AND137 LNG VESSELS ON THE ORDERBOOK

0

10

20

30

40

50

60

Car

/pas

seng

er fer

ry

Oil/

chem

ical

tan

ker

Cru

ise

ship

PSV

Cont

aine

r sh

ip

Gas

car

rier

Spec

ializ

ed v

esse

l

Tug

RoPa

x

Gen

eral

car

go

Bul

k sh

ip

Ro-R

o

Patrol ve

ssel

Car

car

rier

HSL

C

ON ORDER

IN OPERATION

Source: DNV GL, 2018

0

50

100

150

200

250

300

350

400

2000

2006

2008

2010

2012

2014

2016

2018

2020

2022

2024

2026

ON ORDER

IN OPERATION

LNG READY

GLOBAL ORDERS FOR LNG-FUELLED VESSELS ARE GROWING


n Collaborative relationships between ship owners, charterers, ports, policy-makers, and fuel suppliers

n Developing global infrastructure hubs on the back of supporting demand

n Ensuring harmonized industry standards

31

COLLABORATIVE INDUSTRY & REGULATOR RELATIONSHIPS ARE KEY

FOR GLOBAL UPTAKE OF LNG

Title

James Rockall

WLPGA





LPG – the sister to natural gas


Future of primary energy

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

1970 1980 1990 2000 2010 2020 2030 2040

Primary Energy demand /Billion toe

Oil Gas Coal Nuclear Hydro Renewables

Source: BP Energy Outlook 2018 ET scenario


Lack of energy access is global threat


What constitutes a sustainable energy future?

Focus on a sustainable future through energy

We need our future energy to be:

• Available• Affordable• Acceptable• Accessible


Outdoor air pollution- 9 million deaths per year

Indoor air pollution- 4 million deaths per year

What does unacceptable look like?


Autogas – improving urban air quality


Cooking For Life

One billion new users = 1 million fewer premature deaths


Clean Energy Access


Universal Energy Access can be possible


고맙습니다Thankyou

Title

Vincent DEMOURY

General Delegate, GIIGNL





83 Members in 26 countries– LNG importers and LNG terminal owners and operators

40

33

10

GIIGNL


Energy is “central to nearly every major challenge and opportunity the world faces” - UN

0

2

4

6

8

10

12

1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050 2060 2070 2080 2090 2100

10억

Global population (Bn)

Source: World Bank

Growingpopulation

Risingdemand

Ongoingsupply

Mitigatingclimate change

Improvingair quality

THE WORLD NEEDS MORE AND CLEANER ENERGY


292

92

47

49

47

118

41

48

146

448

143

73

26

23

25

29

28

26

82

107

Delhi, India

Beijing, China

Yangon, Myanmar

Ha Noi, Vietnam

Kuala Lampur, Malaysia

Manila, Philippines

Bangkok, Thailand

Seoul, S. Korea

Dhaka, Bangladesh

Islamabad, Pakistan

Source: World Health Organisation

Air pollution in Asia (Annual mean, ug/m3)

PM2.5 PM10

WHO regards a limit of 10 for PM 2.5 and a limit of 20 for PM 10

Switching from coal to cleaner-burning natural gas can play a significant role in improving air quality today

IMPROVING AIR QUALITY


Source: National Energy Technology Laboratory

LNG fuelled power generation has the lowest SOx, NOx and PM 2.5 emissions of reliable power sources

45-55% lower CO2 emissions compared to coal and up to 90% lower air pollutant emissions

Air pollution from gas-fired and coal fired power plants

0.67 0.70

0.090.01 0.02

Sulphur dioxide Nitrogen oxide Particulate matter

Lb/MWh

Coal emissions

Natural gas emissions

1 Bn people without access to electricity, outdoor air pollution is greatestin populated areas

NATURAL GAS AND LNG ARE UP TO 90% CLEANER THAN COAL


When it reaches its destination, LNG is either used directly as a liquid fuel or is heated up to become gas

Liquefied Natural Gas (LNG) is natural gasthat has been cooled to -162⁰C to enableit to be transported over long distances and increase energy density

In 2018, more than 600 LNG cargoes weredelivered to South Korea from 23 exportingcountries

WHAT IS LNG?


20 producing countries supplied LNG to 42 importing countries in 2018

LNG ImportersLNG ExportersDual Importers and Exporters Ceased / Suspended LNG Exporters

Source: GIIGNL Annual Report

LNG PROVIDES AFFORDABLE ENERGY ACCESS TO 42 COUNTRIES WITH A COMBINED POPULATION OF 4.9BN


Asia represents 76% of global LNG imports

2018 vs 2017+24.0 MT(+8.3 %)

16 9

2017 2018

MENA46 49

2017 2018

Europe

17 17

2017 2018

Americas

211 239

38 44

2017 2018 2017 2018

Asia

Source: GIIGNL Annual Report

314 MT OF LNG IMPORTED WORLDWIDE IN 2018


LNG provides low-carbon energy from multiple regions

17Mexico

>850 mtpaof proposed projects

Pre-FID projects (mtpa)

105Africa

275Canada

336United States

51Middle East

61Russia & FSU

52Asia Pacific

Source: GIIGNL Annual Report, IGU 2018 World LNG Report

050

100150200250300350400450

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

2012

2014

2016

2018

Liquefaction capacity by region (mtpa) 1978-2018

Atlantic Middle East Asia Pacific

ABUNDANT LNG SUPPLY WORLDWIDE


WHY LNG?


Beijing gas demand boosted by measures to reduce air pollution

Gas demandSource: US Embassy, Beijing Gas Group

Beijing air quality and gas demand

Air quality

4.95.7

6.5

6.5

7.9

8.7 10

13.114.4

15.6

17.8

85.1

101.8104

99.1

90.5

101.7

97.7

82.7

72.9

65.4

43.0 40

50

60

70

80

90

100

110

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 20180

2

4

6

8

10

12

14

16

18

20

Air Quality(PM 2.5)

Gas Demand(BCM)

LNG DELIVERS AIR QUALITY IMPROVEMENTS


LNG supports generation when the wind doesn’t blow or solar is low

Source: REE, EnagasWind generation (hourly) Solar generation (hourly) LNG send out (daily)

Power generation(GWh/h)

LNG send out(GWh/h)

Spanish power generation (Dec. 2017)

-

5

10

15

20

25

30

35

40

45

50

-

2

4

6

8

10

12

14

16

18

천

LNG PROVIDES FLEXIBLE BACKUP TO RENEWABLES


Japanese gas utilities have well-diversified LNG sources and are well prepared for a possible supply disruption

1st quarter

25 26 32 32 32 32 30 33

22 2429 27 29 26 25 26

2528

28 29 29 28 29 27

24

28

29 30 3029 29 28

0%

5%

10%

15%

20%

25%

30%

35%

40%

0

20

40

60

80

100

120

140

2010 2011 2012 2013 2014 2015 2016 2017

LNG demand in Japan (BCM)

2nd quarter 3rd quarter 4th quarter Nuclear power share %

LNG imports(BCM)

Nuclear sharein power mix %

Source: METI, OIES, IEA

LNG PROVIDES SECURE LOW CARBON ENERGY


A CLEANER, MORE AFFORDABLE AND AVAILABLE FUEL FOR TRANSPORT


THANK [email protected]

Title

Mark Lipton

GE Marine





LNG Fueled Vessels: Growing Opportunities for Korean Shipbuilding and Shipping Industries

247 LNG fueled ships confirmed, and 110 additional LNG ready ships

Market Trends

ROK government plans for 100 LNG fueled ships and 5 LNG bunkering ports by 2025

Shipping companies placing orders for LNG-fueled ships…containerships, bulk carriers

Korean shipyards continue to lead in LNGC, winning 55 LNGCs out of 69 ordered in 2018

LPG as clean marine fuel, the first LPG fueled ferry with Korean partners

Ship conversion for environmental compliance…steam turbine powered LNGC to more efficient gas turbine


Emissions Case for LNG

Outperforms conventional marine fuel• Zero SOx• 90% NOx reduction• 99% decrease in PM

No waste disposal or discharge issues

Significant GHG reductions • 20% compared to existing• 40% with ship Energy Efficiency

Design Index measures • Further benefits with bio or synthetic

gas

Unmatched local emissions performance and major improvement for GHG


LNG Fueled High Speed Ferry

Buquebus ferry Francisco – built by Incat

• Commissioned in 2013; ~16,000 hours on LNG to date

• Powered by 2 x LM2500 dual fuel gas turbines driving water jets

• 450 tonnes deadweight– Length = 91 meters– Breadth = 26.9 meters– Draft = 2.94 meters– Service speed = 52.5 knots– LNG stored in two, 40 m3 tanks

• Operating profile (106 nautical miles):– Begin in Buenos Aires– Start on liquid fuel– Accelerate to service speed and transfer to

LNG– Arrive in Montevideo in ~2 hours


SEA LNG – The Marine Industry Advocate for LNG

LNG as a marine fuel delivers best ROI for a 10 year NPV basis*

1. Stranded fuels

2. Business as usual “BAU”

3. Tight supply for distillates

4. LNG economies of scale

5. LNG liquefaction technology improvements

6. Tight MGO, unavailable HSFO, improve LNG

* Source: “LNG as a marine fuel – the investment opportunity,” SEA LNG newbuild 14,000 teu liner vessel on Asia-USWC trade


Thank you

Title

Hansch van der Velden,

Director Corporate Communications, Gasunie, the Netherlands

Chair Marketing & Communications Committee, IGU


“Mega Cities, Mega Clean”


4th edition, 2019IGU Marketing & Communications Committee.Members from: Columbia, Qatar, Canada, Austria, the Netherlands, Russia, UK, Korea, Norway, Oman, Belgium, Egypt, Poland, Ukraine, Czech Republic, Slovak Republic, Poland, Switzerland etc.


1952: 4,000 dead in 5 days (London)

In 2060, 6-9 million premature deathsCosts: 1% of global GDP (2,6 trillion USD) (OECD, 2016)


Riding a bike not always a good idea


Seoul

Madrid Bogota

Cities are taking comprehensiveactions:

- Displacing polluting fuels

- Closing coal plants

- Gas for heating/cooking

- Gas in (public) transport: CNG, LNG, LPG


Korean government: mix of measures3 June 2016 and 26 September 2017


Public acceptance ofbad air is quickly evaporating


Citizens are taking the lead


Clean air in mega cities is a Mission Possible.


Korea: Chef de Mission


Korea: Chef de EMISSION…

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